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Harvey Norman local sales jump as global shutdown hits retailers

Harvey Norman's same-store sales in Australia jumped more than 9 per cent this month as anxious shoppers snapped up freezers, smart TVs, laptops and monitors in preparation for months of social distancing and working from home.

Same-store sales have fallen at Harvey Norman company-owned stores in Northern Ireland (-12.4 per cent) Singapore (-1 per cent) and Malaysia (-5 per cent) from March 1 to March 17.

Sales are up in Gerry Harvey's key markets but Slovenian, Malaysian and Croatia stores have closed. Janie Barrett

However, this has been more than offset by stronger same-store sales in Australia (up 9.4 per cent), New Zealand (up 12.4 per cent) Croatia (up 1 per cent) and Ireland (up 53 per cent).

In Slovenia, where stores closed from March 16 until further notice, same-store sales from March 1 to March 14 fell 1.7 per cent. Malaysian stores have closed from March 18 to March 31, and the Croatian store closed from March 19 for 30 days.

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However, company operated stores in New Zealand, Ireland, Northern Ireland and Singapore and franchised stores in Australia currently remain open for business.

Harvey Norman appears to be faring better than other discretionary retailers – for the time being at least – judging by a flurry of trading updates on Thursday.

While like-for-like sales at Adairs stores rose 7.1 per cent in the 11 weeks to March 15 (store sales were up 0.7 per cent and online sales up 31.8 per cent) chief executive Mark Ronan said the outlook for the June quarter had "changed materially".

"The level and nature of the uncertainty in relation to medium-term trading conditions is unprecedented," he said. The company's priority was to maintain liquidity and protect long-term shareholder value.

Footwear retailer Accent Group also backed away from previous guidance and warned it now expected full-year profits to decline, despite 11 per cent profit growth in the December-half.

Chief executive Daniel Agostinelli said sales had fallen sharply in the first two weeks of March, dragging like-for-like retail sales for the first 11 weeks of the June-half down 1.2 per cent.

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"Of greater impact is the uncertainty as to the ongoing impact of COVID-19 on consumer demand and the company’s trading over the next few months,' he said.

The retailer was focused on ramping up sales through its 18 websites while managing costs including rent to ensure the business was well set up to accelerate when conditions normalised, he said.

Fast-fashion jewellery chain Lovisa said all its stores in France, Spain and Malaysia and 25 stores in the United States had closed and were expected to remain shut until the end of the month or mid April.

All other markets were currently open, but there had been a significant deterioration in foot traffic and sales, said chief executive Shane Fallscheer.

"We are not in a position to reliably estimate the financial impact of these events in the coming months," he said.

At plus-sized fashion retailer City Chic, same-store sales have risen 8.6 per cent in the year to date, and supplies from China have been restored.

But chief executive Phil Ryan said government containment measures to limit the spread of COVID-19 were dampening consumer spending and the impact on sales and earnings for the rest of the year was unknown.

Domino’s is also closing stores in France, for 15 days, but other stores in Europe continue to trade, albeit for carry-out and online orders only.

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